10 August 2004	Tuesday	23 Jamadi-us-Saani 1425

KARACHI, Aug 9: Pak-Arab Refinery Co. has rolled over a $100 million swap maturity due August by three months after consultations with the central bank due to the current pressure on the domestic currency, a source told Dow Jones Newswires on Monday.

The $100 million payment, which is part of a $350 million rupee-dollar swap conducted in June, will now mature in November, the banking source said. The other two maturities of $100 million each will be paid on schedule September and October, he said.

The company had repaid $50 million earlier. "PARCO, after active consultations with the State Bank, decided to roll over the maturity for August for three months," the source said.

The delay in payment comes amid recent volatility in the country's forex market, where the central bank intervened heavily last week to stabilize the rupee at 58.90, down from a two-year low of 59.30 on Wednesday.

The rupee has fallen sharply in the past fortnight after the central bank said in a recent report that the domestic currency is likely to come under pressure, due mainly to a yawning budget deficit.

Parco borrowed Rs20.5 billion from five banks in June to secure cheaper rupee financing to repay a foreign exchange loan from the Japan Bank for International Corp. ahead of schedule.

The banks were United Bank Ltd., Standard Chartered Bank, Habib Bank Ltd., National Bank of Pakistan and Muslim Commercial Bank. It was the biggest syndicated loan facility ever for Pakistan.

The loan was part of $600 million Parco took for the construction of a $887 million refinery near Multan in the central Punjab province. However, the heavy debt payments in June forced Parco to enter into a four-month rupee-dollar swap with the five banks for $350 million, with the first maturity of $50 million due in July. The remaining were spread over August, September and October.

Despite Parco's latest rollover, dealers said the rupee is likely to face greater pressure this week because of $33 million in upcoming payments for oil imports and corporate debt payments.